Veranstaltungen

2025-03-13, 2025-03-13 bis 2025-03-13

Economic Theory & Policy Seminar / Marco Airaudo (Drexel Univ.) / Overcoming Trend Inflation: The Power of Average Inflation Targeting

Seminar

Marco Airaudo will give a talk at our Economic Theory and Policy Seminar.

Marco Airaudo, öffnet eine externe URL in einem neuen Fenster (LeBow College of Business, Drexel University)
(joint with Fangqian Wu)

"Overcoming Trend Inflation: The Power of Average Inflation Targeting" 

We assess the performance of Average Inflation Targeting (AIT) in a New Keynesian model with trend inflation. Our findings show that AIT significantly outperforms traditional Inflation Targeting (IT) across several dimensions: (1) it expands the equilibrium determinacy region;
(2) it dampens economic responses to shocks as trend inflation rises; and (3) under optimal monetary policy, the optimal AIT delegation closely approximates welfare under commitment and increasingly outperforms IT under discretion at higher trend inflation levels. These results establish AIT as a powerful monetary policy framework for environments with moderate positive trend inflation.

Kalendereintrag

Veranstaltungsort

TU Wien
1040 Vienna
Wiedner Hauptstr. 8-10, Seminarroom: DB03 (Freihaus buidling, yellow area, 3rd floor)

 

Veranstalter

ECON
Julia Hutter
julia.hutter@tuwien.ac.at

 

Öffentlich

Ja

 

Kostenpflichtig

Nein

 

Anmeldung erforderlich

Nein